Office market demand strong, space low

Office market demand strong, space low

There’s strong demand in the local office market and the supply of available space is “extremely low.”

Branon Pesnell, with Beau Box Commercial Real Estate, said the occupancy rate in Baton Rouge is a little more than 88 percent, up from 86 percent in 2013. At the same time, rents rose in areas such as Acadian/College, Sherwood Forest and Essen/Bluebonnet.

New tenants have entered the market, such as IBM, and there has been a steady flow of expansions in businesses associated with engineering, construction, technology and business services, Pesnell said Thursday at an annual real estate trends seminar.

“There are not a whole lot of options in the 10,000-square-foot-plus area,” he said. Adding to the problem is the lack of large-scale parking spaces in downtown. This has caused some national and regional tenants to look at opening offices in other markets, because of the shortage of options in Baton Rouge.

“Opportunities are prime for office development,” Pesnell said.

The demand for office space is expected to continue through the year because of expansions and relocations into the market.